Puerto Rico Governor Alejandro García Padilla presented a $9.1 billion spending plan for the fiscal year starting July 1 that allocates just $209 million for bond interest payments, reiterating his stand that the commonwealth plans to skip most debt obligations, Bloomberg News reported yesterday. “Paying the debt in its totality would have meant taking health benefits away from more than a million people, or having to fire countless police officers and closing the Centro Medico” health facility, García Padilla said during a televised address. Or, he said, “going without school transportation and garbage collection.” Island lawmakers have until June 30 to approve a budget for fiscal 2017 or the government uses the current year’s spending plan as a framework. The budget proposal doesn’t rely on borrowing to fill a deficit and doesn’t include any tax increases, the governor said. It is $192 million less than the revised $9.3 billion fiscal 2016 budget. This is García Padilla’s final budget as he is not seeking re-election. Island officials anticipate Puerto Rico’s economy will shrink by 2 percent in fiscal 2017, for the fifth straight year of economic contraction. The administration is working on reducing the island’s $70 billion debt burden by asking investors to accept losses on their securities. The commonwealth and its agencies owe $2 billion on July 1, including $805 million for general obligations which García Padilla has said multiple times that the government doesn’t have the money to pay.
